Wall Street turned bullish on Tuesday, and OTC stocks are benefiting from the improving sentiment. Stock indices are recovering some of the previous losses as a temporary agreement regarding the debt ceiling relieved worries of a potential default that could send the economy into a major crisis. Meanwhile, a correction in oil prices, which recently hit the highest in seven years, eased concerns of high inflation.
On Wednesday, Top US Senate Republican Mitch McConnell presented a plan to support an extension of the federal debt ceiling into December. Congressional Democrats and Republicans are carrying on with the negotiations at the time of writing.
Greg Swenson, founding partner of Brigg Macadam, told Reuters:
“I didn’t think there is actually going to be a default, it is a low probability, high severity possibility. And since that’s been removed from the market, I’m not surprised to see this bounce in futures. I’m not worried about the markets in the near term and buying dips is advisable.”
Buying the dip is what we always recommend when it comes to investing in OTC stocks, never chasing. Now is a great time to invest in quality OTC stocks given that the economy is recovering and the government debt default risk has been minimized.
OTC STOCKS THE PLACE TO BE
Smart investors know that if you want to make the big money off a small account, the place to be is the OTC Markets. There are many good OTC stocks that can boost your portfolio’s value in the long term. For investors, we preach the key to trading penny stocks is finding momentum BEFORE it happens and ahead of the crowd.
We alert our subscribers with our best ideas before our regular readers. This is the value of having a subscription to Insider Financial, which you can sign up for here.
If you watch the Insider Financial YouTube channel, you can get a sense of the ideal time to book profits. We warned our subscribers not to get greedy or get caught up in the diamond hands/paper hands BS.
We also recommend you own a portfolio of penny stocks. For some, that can be as many as 10 to 20 or more OTC stocks. This provides diversification and allows one to manage the market’s moods much easier. It also helps to own shares in the following 4 hot OTC stocks.
In this article, we look at 4 OTC stocks that will greatly reward patient investors. They are Cyber Apps World Inc (OTCPK: CYAP), Infrax Systems, Inc (OTCPK: IFXY), Strategic Asset Leasing Inc (OTCPK: LEAS), and New America Energy Corp (OTCPK: NECA).
OTC STOCKS #1 CYAP
Cyber Apps World Inc has been making waves, although the OTC stock is still trading at only a fraction of what it used to cost in the first quarter of the year. CYAP has doubled in price during the last five days, currently trading at $0.011, which seems to be a strong resistance level as the stock failed to break it on Monday.
Anyway, the price is quite cheap considering that CYAP used to trade above $0.30 as of March.
Before trying to understand what happened with the share price, know that CYAP is a company focused on acquiring and developing a global e-commerce internet platform with the purchase and sales of products and services by way of mobile/PC applications worldwide. The company is working on providing an ever-growing list of apps to subscribers.
As for the price decline, the main reasons can be found in the announcements regarding CYAP’s 3 lawsuits against 3 companies. For example, in May, CYAP launched legal action against EMA Financial, LLC’s (EMA) in Nevada District Court for breach of contract claims relating to a share purchase agreement and corresponding convertible promissory note. In March, Cyber Apps attempted to prepay EMA’s convertible promissory note for the premium stipulated in the note, but EMA, relying on a most favored nation clause, took the position that the payout amount was significantly higher than the amount that Cyber Apps believed was due. Cyber Apps’ legal counsel put EMA on notice that it disputed the prepayment amount due pursuant to the note. Next month, EMA provided Cyber Apps and its transfer agent with a notice of conversion whereby it instructed the transfer agent to convert the entire principal amount of the note, plus interest, for 1,281,682 shares of CYAB. Because the note contains a clause that allows EMA to cancel the conversion if the shares are not issued within one business day of the conversion notice, EMA canceled the conversion on April 8 following the decline in Cyber Apps’ stock price. The transfer agent advised Cyber Apps that it could not issue the converted shares by the one business day deadline because EMA did not provide it with the necessary documentation to effect the conversion and issue the shares. Meanwhile, EMA provided successive conversion notices to CYAB and its transfer agent, which resulted in EMA being issued 18,369,800 shares of Cyber App’s common stock. Through its sales of this stock, the Company’s share price declined by over 90% from $0.102 on April 6, 2021, to $0.009 on May 23, 2021.
CYAB said that it was ready and able to prepay EMA’s note for the amount originally stated in the note by the prepayment deadline date, but it suffered damages due to EMA’s failure to accept that prepayment.
CYAB is seeking damages of over $15 million for its decrease in market capitalization due to the wrongful actions of EMA, as well as punitive and other damages.
The company has also commenced legal action against East Capital Investments Corp in connection with ECI’s conversion of debt into shares of Cyber Apps pursuant to a penalty clause relating to a share purchase agreement and corresponding convertible promissory note.
Another legal action was launched against Black Ice Advisors LLC, which also converted debt into CYAB’s shares.
CYAB’s complaints have ground and if it wins these cases, the share price of the $3 million company may recover, so this is something investors should consider.
On Monday, the company said that last month it had obtained a default judgment against East Capital Investments Corp. for its alleged conversion of a penalty amount into Cyber App’s common stock prior to the expiry of the statutory hold period. This suggests that CYAB may indeed recover part of its market cap losses.
Meanwhile, it said that it started BETA testing of its Friendly and Fast Delivery App in Ahmedabad, India. The app is designed to provide consumers and businesses with delivery options including food, groceries, and courier services. The app is now fully developed and has reached the BETA testing stage. CYAP selected Ahmedabad, India for the location of a three-month testing program and expects to launch this application in the US in early 2022. Both customers and businesses will be able to place orders at virtually any time, from anywhere, saving them time and resources typically spent on traveling to the actual location.
OTC STOCKS #2 IFXY
The chart of Infrax Systems, Inc is quite the opposite of CYAB. IFXY has surged to the highest in over 5 years, gaining over 125% in the last five days to trade at $0.011.
Infrax, which has turned into a $60 million business, promotes itself as a brand incubator and accelerator. It plans to build a portfolio of revenue-generating product microbrands and polish the logos, messaging, and marketing strategies of each brand to develop new sales channels and increase brand awareness and revenues. It focuses on acquiring products in the lawn and garden, home improvement, sports and fitness, and health and beauty sectors.
This is a new business direction for the company that got its Pink Current status only recently.
In May, control of the company was transferred to Krisa Management, which brought in new operations that are still in the development stage.
Krisa is dealing with several shells – you may know it from our post about AVVAA World Health Care Products, Inc (AVVH). Krisa said it would get rid of some shells to focus on IFXY and turn it into a solid company.
We have big plans for $IFXY. Great team is coming together. Details once we complete the transactions for our other shells. We will be hot and heavy on this one building a great company over the next few years.
— Krisa Management LLC (@KrisaManagement) September 30, 2021
Carey W Cooley, CEO of both Krisa and IFXY, calls the latter “his baby,” which suggests he has serious plans for the shell, and considering his experience in the OTC market, this is great news for IFXY investors, especially considering that the stock has a great share structure and the CEO holds a good chunk of the shares.
We will keep you updated on IFXY as it expands its business and acquires operational businesses.
— Joei Dior (@1hotcup) October 1, 2021
OTC STOCKS #3 LEAS
Strategic Asset Leasing Inc is another OTC stock that is making waves. It has surged about 200% during the last five trading days and over 1,300% over the last month, showing that investors can book generous profits on OTC stocks. LEAS is now trading at $0.013, after peaking above $0.15 to hit the highest in over five years.
In December, LEAS appointed a new management team and apparently shifted business direction, although it’s still not clear what the company wants to do. On the OTC Markets profile, it says that it manages assets in the Real Estate and ELA (Exotic Luxury Automobiles) leasing industry. However, in the latest press release that came in December, the company said that it was leveraging technology assets with a focus on the FinTech Industry and Internet of Things (IoT).
Despite everything, LEAS may end up a biotech firm. Investors are excited about a potential merger between LEAS and Pharmia, which aims to become a leading generics and super-generics company within 5 years. In executing its plan, Pharmia will take a three-stage approach to the achievement of its goals.
— ClairvoyantAlphaTrader (@ClairvoyantINVT) October 1, 2021
Pharmia is focused on the production, marketing, and sales of life-saving drugs which are either “at risk” of being discontinued or in chronic short supply in the US and Europe. Drugs referred to as “at risk” are those that are not considered highly profitable by the leading pharmaceutical manufacturers’ but are still essential in the treatment of life-threatening diseases. In this latter respect, the company is primarily focused on a portfolio of products to treat cancer and infectious diseases, and shortages of drugs caused by the coronavirus pandemic.
LEAS is a $13 million company that has a great share structure that reduces the risk of dilution.
There is no official announcement of a merger, but Joseph Sinkule is the CEO of both LEAS and Pharmia. He has 35 years of drug, biologic, and medical device commercialization experience, being a serial entrepreneur as well. He has personally managed over 8 drug and biotech products successfully through FDA approval to market, 5 medical devices, and 8 in-vitro diagnostics. He has hired and managed both small and large teams of people in pharma and biotech organizations and ran contract research organizations (CRO’s) working for large and small clients.
So far, we’re excited about LEAS. If the merger is confirmed, it’s blue skies ahead for LEAS.
OTC STOCKS #4 NECA
New America Energy Corp is a company that has reorganized its business following a reverse merger. The Pink Current stock has gained over 50% since last week, peaking on Monday at $0.0026, which is the highest since mid-August.
Back in July, NECA acquired Third Bench Holdings, an industry leader in kitchen and bathroom cabinetry and countertops. The closing with Third Bench is expected to bring an estimated $24 million in revenue to NECA in 2021.
Third Bench has a particular emphasis on well run, long-standing, regionally dominant businesses owning a multi-year, established, defensive leadership position in a regional market.
The management team and operating brands represent decades of experience with an operationally oriented partnership that manages North America-based architectural millwork, cabinets, countertops, and, generally, permanent “housing-infrastructure” brands.
As a result of the acquisition, Third Bench Holdings CEO David Fair became the CEO of NECA and replaced Jeffrey M Canouse.
Third Bench, through its 3 subsidiaries, offers products in categories: Residential Cabinets and countertops, and commercial millwork throughout the Western US for customers from California to Texas. The company also provides installation services as a part of its vertical offering.
Third Bench employs over 140 people and had revenue in excess of $18.8 million in 2020. Third Bench is on a run rate of over $24.0 million for 2021 and is cash-flow positive. These projections have been provided by management and do not include the additional acquisitions that are currently under review. These figures are great for a $10 million business. We think NECA is undervalued right now.
In August, CEO David Fair said that the company was pursuing several strong acquisitions targets that would be highly accretive to Third Bench and drastically increase its revenue.
“We believe with our current pipeline of acquisition targets and the robust housing market that Third Bench can achieve revenues north of $50 million by 2022 and become the dominant cabinet supplier in the Southwestern United States,” the CEO said.
Third Bench is looking to expand and seeking to uplist on a larger exchange, so this is definitely a great OTC stock to consider for your portfolio for the long-term.
— @necaholdings (@necaholdings) September 8, 2021
THE FINAL NOTE
All of the 4 OTC stocks discussed today are on the rise and are good stocks to hold. Nevertheless, our best advice is to be patient and enter the market during corrections. Buying dips and selling rips as swing trades remains the best strategy in the penny stock market. Still, whenever a penny stock is in the middle of a bull run, we recommend our subscribers to book profits.
It’s very important to eye the best OTC stocks that have room for growth and have yet to make their explosive move. There are plenty of opportunities, and we take our time to monitor hundreds of penny stocks to buy each week, trying to find the best alerts for our subscribers.
Remember, all you need is one or two penny stocks to succeed in order to crush the market averages.
As always, good luck to all (except the shorts)!
WHEN INSIDER FINANCIAL HAS A STOCK ALERT, IT CAN PAY TO LISTEN. AFTER ALL, OUR FREE NEWSLETTER HAS FOUND MANY TRIPLE-DIGIT WINNERS FOR OUR SUBSCRIBERS. WE SPECIALIZE IN FINDING MOMENTUM BEFORE IT HAPPENS!
Disclosure: We have no position in any of the securities mentioned. We wrote this article ourselves and it expresses our own opinions. We are not receiving compensation for it. We have no business relationship with any company whose stock is mentioned in this article. Insider Financial is not an investment advisor and does not provide investment advice. Always do your own research and make your own investment decisions. This article is not a solicitation or recommendation to buy, sell, or hold securities. This article is meant for informational and educational purposes only and does not provide investment advice.